Overview

In 2017 the final energy consumption (FEC) in Latvia was 4.1 Mtoe; the increase was about 19% in comparison with the year 2000. The greatest changes were in the residential sector where energy consumption dropped by about 15% and the share of which in the FEC decreased by about 12 percentage points to reach 30% in 2017. The transport sector has the other greatest share in the FEC with 30% in 2017 (+ 8 percentage points compared to 2000). Since 2000 the FEC in industry had increased by around 37% with a share close to 19% in 2017. 

Figure 1: Final energy consumption by sector (normal climate)

Source: ODYSSEE

Energy efficiency for final consumers, as measured by ODEX, improved by 34%, or 2% per year from 2000 to 2017. In the industry, despite the economic recession (2008-2010), there has been steady progress and larger gains than in the other sectors (2.6% per year). The financial support programs from the State and the implementation of legislation targeted at reducing heat losses from buildings had contributed to the improvement of energy efficiency in the residential sector by about 39% (average 2.3%/year). For the transport and service sectors, gains are lower (1.7% and 0.8% per year respectively since 2000).


Figure 2: Technical Energy Efficiency Index

Source: ODYSSEE

Energy efficiency improvement is one of the top priorities of the national energy sector development, both in the national “Energy Sector Development Guidelines 2016-2020” and "National Energy-Climate Plan 2030", which allows for the cost-effective reduction of risks associated with security of energy supply, provides sustainability, competitiveness and growth of national economy, in line with a contribution in GHG emissions mitigation. The Latvia primary energy consumption should not exceed 5.3 Mtoe in 2020 and 4.4 Mtoe for final energy consumption. These values fulfills the indicative national energy efficiency target, of Art.3 of Directive 2012/27/EU (EED) – 0.67 Mtoe primary energy savings in 2020.  Mix of instruments are used for energy efficiency policy implementation. The co-financing of energy efficiency investments (see sectorial Tables) and energy management systems can be noted as ones of them. The current Energy Efficiency Obligation Scheme includes, up to 31 December 2020, electricity retailers. 


Table 1: Cross-cutting measures

MeasuresNEEAP measuresDescriptionExpected savings, impact evaluationMore information available
Energy Audits (EA) and Energy Efficiency Improvement in Large Enterprises (Industry, Services, Transport sectors)yesThe first EA should be performed by December 2017, or one year after the inclusion in the list of large entities. The entity shall provide annual report on implemented energy efficiency (EE) measures and energy savings reached. The entity shall implement by April 2020 at least three EE measures with the highest energy savings or highest economical return.HighLink
Energy Management Systems (EMS) in Entities - Large Electricity Consumers (> 500 MWh /year of electricity in industry, services and transport). yesThe EMS should be implemented by April 2018. The entity shall provide annual report on implemented EE measures and energy savings reached. The entity shall implement by April 2022 at least three EE measures with the highest energy savings or highest economical return. MediumLink
Energy Efficiency Obligation SchemeyesBy December 2020 the Scheme includes electricity retailers with annual sale over 10 GWh. HighLink
Efficiency requirements for district heating (DH) systemsyesCabinet of Ministers Regulation states minimum efficiency coefficients (average annual) for DH production and maximum heat loss for pipeline networks. In turn, the Cohesion Fund, within the framework of National Operational Programme “Growth and Employment, 2014-2020 planning period, provides investment co-financing. MediumLink
Source: MURE

Buildings

In 2017, space heating accounted for 69% of sector’s consumption, water heating for 18% and cooking for 6%. In comparison with 2000 the share of electrical appliances and water heating has grown by respectively 4 and 5 percentage points. At the same time the share of space heating has decreased by 6 percentage points. While energy consumption of electrical appliances and water heating per dwelling increased since 2000 (0.4% and 1.3%/year respectively), space heating consumption decreased by 1.2%/year over the same period. Hence energy consumption per dwelling decreased by 0.7%/year since 2000 largely due to energy efficiency gains for space heating.


Figure 3: Energy consumption of space heating per m2

Source: ODYSSEE

Figure 4: Energy consumption per dwelling by end-use (except space heating)

Source: ODYSSEE

The final energy consumption of households has decreased slightly by 0.6%/year in the period 2000-2017. On the one hand, two main drivers contributed to increase energy consumption – larger homes (by 0.44 Mtoe) and changes in consumer behavior (by 0.14 Mtoe). On the other hand, energy savings (0.71 Mtoe) fully compensated the effect of the above-mentioned energy consumption drivers. As a result, the final energy consumption of residential was 0.13 Mtoe lower in 2017 than in 2000.


Figure 5: Main drivers of the energy consumption variation in households

Source: ODYSSEE

Energy consumption per employee decreased by 1% between 2000 and 2017. To a large extent it was due to the sharp increase by 37% of electricity consumption per employee. Though electrical appliances become ever more efficient, the rapid increase in their number and diffusion of ICT in offices contributed to the growth of electricity consumption.  

Figure 6: Energy and electricity consumption per employee (normal climate)

Source: ODYSSEE

Buildings is one of the top priorities of the national energy efficiency policy. Mix of investment support, regulation, information measures are used. Thermal engineering of new apartment building envelopes since 1980 is characterized by continuous stringent regulations, which resulted in decrease of the specific normative energy consumption for heating: 150-200 kWh/m2/year (1980), 100-130 (1992), 70-90 (2003), 60-85 (2015), 40 (2021). Most of multi-apartment buildings were built before 2004 and thus the potential for energy savings in these buildings is high. Only ~7% of the total floor area of multi-apartment buildings had been built since 2004. Annual average heat consumption for heating in multi-apartment buildings in 2016 was 152 kWh per m2. It is envisaged that measures on improving energy efficiency in buildings will decrease this figure by about 20% in 2023. The Cabinet of Ministers Regulation on Energy Certification of Buildings (2013, amended 2015) introduced six EE classes. In April 2014 the requirements of the re-casted Directive 2010/31/EU has been included in the national Construction Standard. This is followed by the new Construction Standard (in force 2020). High attention to energy efficiency of buildings is paid by "National Energy-Climate Plan 2030". 



Table 2: Policies and measures implemented in the building sector

MeasuresDescriptionExpected savings, impact evaluationMore information available
Energy certification of residential buildings (Cabinet of Ministers Regulations)Establishes Latvia specific values for energy efficiency (EE) classes. Requires all new residential buildings to meet nearly zero energy building standard (40 kWh/m2/year for heating) after 01.01.2021. Defines EE requirements for renovated buildings. States threshold level for heating (class F, above 150 kWh/m2/year) above which the building needs energy performance improvement measures.MediumLink
Increasing energy efficiency (EE) in multi-apartment buildingsIn 2007-2013 planning period EE improvement measures in multi-apartment buildings were co-financed by the ERDF within the National Operational Programme (NOP) “Infrastructure and Services”. Over the 2014-2020 planning period, EE improvement measures in multi-apartment buildings, co-financed by ERDF, are implemented within the National Operational Programme “Growth and Employment”. To be continued in 2021-2027 planning period. HighLink
Information programme “Let’s Live Warmer”Highly effective programme ensuring that information on energy efficient housing renovation is widely available. Actions of the programme motivate flats’ owners of apartment buildings to renovate buildings and provides information on the best practices.MediumLink
Energy certification of non-residential buildings (Cabinet of Ministers Regulation)Establishes Latvia specific values for energy efficiency (EE) classes. Requires new public buildings to meet nearly zero energy building standard (45 kWh/m2/year for heating) from 01.01.2019, other new non-residential buildings – from 01.01.2021. Defines EE requirements for renovated buildings. States threshold level for heating (class F, above 150 kWh/m2/year) above which the building needs energy performance improvement measures.MediumLink
Increasing energy efficiency (EE) of public buildingsIn the period 2010-2015 the EE improvement measures in public buildings were co-financed by the national green investment scheme (revenues from emissions trading under UNFCCC Kyoto Protocol). Over the 2014-2020 planning period, EE improvement measures in municipal and state public buildings are co-financed by ERDF within the National Operational Programme “Growth and Employment” (see the measures SER-LV1706 and SER-LV1707 respectively). To be continued in 2021-2027 planning period. HighLink
National Construction Standard LBN002-15 “Thermotechnics for building envelopes” Set a minimum performance level (values for heat transmittance coefficients) for the construction elements to be installed/replaced. The Standard transposed the requirements of Energy Efficiency Directive 2010/31/EU and was in force until 31.12.2019. See the measures HOU-LV0782 (residential buildings) and SER-LV1702 (non-residential buildings).aced. MediumLink
National Construction Standard LBN002-19 ”Thermotechnics for building envelopes”The new Standard replaces previous one with the same title which was in force until 31.12.2019. The new Standard directly incorporates the energy performance requirements (in kWh per m2 annually) for new and reconstructed/renovated buildings. In turn, the objective of the adjusted maximal U values is to eliminate the design of unsafe construction elements. See the measures HOU-LV0784 (residential buildings) and SER-LV3874 (non-residential buildings) MediumLink
Public sector as an example: demonstrating low-energy and energy self-sufficient buildingThe current national green investment scheme (revenues from EU ETS Emissions Allowances Auctioning) provides the co-financing to low-energy and energy self-sufficient public building.MediumLink
Source: MURE

Transport

Road transport constitutes the greatest part of energy consumption in transport. In 2017 cars accounted for 52% of the sector’s consumption and road freight transport for 27%. From 2000 to 2017 the share of railway in transport energy consumption has decreased from 9.2% to 4.6%. Air transport (domestic, international) represents 11.6%. 


Figure 7: Split of the transport energy consumption by mode

Source: ODYSSEE

The passenger traffic grew by around 1.4%/year since 2000. The growth was mainly observed in the traffic by cars (0.4%/year) while public transport showed an opposite trend: road public transportation decreased by 0.25%/year and rail by 0.17%/year. In 2017 cars represented 84% of the traffic of passengers.

Figure 8: Share of transport modes in passenger traffic

Source: ODYSSEE

Freight transport (measured in tonne-kilometre) showed a steep increase as well in comparison with 2000 (3.9% per year). Road traffic has increased much faster than rail (12.5% per year against 0.8% per year). The share of road freight transport has increased by 24 percentage points since 2000 to reach 50% in 2017.

Figure 9: Share of modes in freight traffic

Source: ODYSSEE

The energy consumption in the transport sector has increased by 3.8%/year from 0.72 Mtoe to 1.19 Mtoe. The main drivers for the increase is the growth in passenger and freight traffic (0.49 Mtoe) and shift from public transport to cars (0.24 Mtoe). Energy saving (0.39 Mtoe) counterbalanced the activity effect due to more efficient cars and trucks.

Figure 10: Main drivers of the energy consumption variation in transport

Source: ODYSSEE

Latvia policies promote zero/low-emission vehicles and environmentally friendly transport infrastructure. "Electromobility Development Plan 2014-2016" has been followed by "Alternative Fuels Development Plan 2017- 2020". A mix of measures is applied: investment, regulations (standards, labelling, public procurement), fiscal, information, education measures. E.g., in 2016 it was introduced cars’ annual operational tax based on specific CO2 emissions. Currently the country-wide electric vehicles' (EV) fast charging network is under establishment. Widening use of environmentally friendly public transport is ongoing as well. Important specific objective is also railway electrification to promote environmentally friendly freight transport. High attention to zero and low emission vehicles is paid by  "National Energy-Climate Plan 2030". 



Table 3: Policies and measures into force in the transport sector

MeasuresDescriptionExpected savings, impact evaluationMore information available
Annual operational tax of cars based on specific CO2 emissions Motivates car owners to choose fuel efficient vehicle. The 2016 Amendments on the Law „On the Vehicle Operation Tax and Company Car Tax” have introduced specific CO2 emissions based tax for cars, which had first registration in 2009 and afterwards. MediumLink
Development of the infrastructure of environmentally friendly public transportThe two specific objectives are (1) widening of trams infrastructure, (2) increase of number of environmentally friendly public busses. Promotes passenger shift to user convenient public transport. Investments are co-financed by Cohesion Fund within the National Operational Programme “Growth and Employment 2014-2020”. MediumLink
Electromobility DevelopmentCurrent implementation of country-wide electric vehicles’ fast charging infrastructure is on-going, co-financed by the ERDF within the National Operational Programme “Growth and Employment” (NOP) 2014-2020 planning period.MediumLink
Railway electrificationElectrification of Latvia railway will promote the energy efficiency in railway sector. By 31 December 2023 the 1st phase (electrification of 300 km, direction from Riga to Russia and Belarus) is planned to be completed. Co-financed by Cohesion Fund within the National Operational Programme “Growth and Employment”.HighLink
Source: MURE

Industry

The energy consumption in industry increased by 2.2% per year. The consumption increase was mainly brought about by two branches: non-metallic minerals by 6% per year and wood and wood products by 25% per year; the later absorbs 60% of the energy consumption of the manufacturing sector. 



Figure 11: Final energy consumption by branch

Source: ODYSSEE, steel including blast furnaces

Though steel production decreased considerably since 2014, the previous period revealed the positive effect of improving and replacing technologies on the unit consumption of this branch.   

Figure 12: Unit consumption of energy‐intensive products (toe/t)

Source: ODYSSEE

Since 2000 final energy consumption increased by 2.2%/year driven by a growth in activity (0.49 Mtoe) and other factors (0.17 Mtoe). Such effects have been offset by energy savings (0.42 Mtoe) due to technical improvements of the machineries and processes. The share in the final energy of 5 energy intensive branches decreased by about 19 percentage points. 


Figure 13: Main drivers of the energy consumption variation in industry

Source: ODYSSEE

A mix of investment support, regulation, information measures is used. Currently, over the 2014-2020 planning period, the energy efficiency investments in the manufacturing industry are co-financed by national operational programmes. In turn, the State Development Finance Institution ALTUM provides complementary measures.  High attention to energy efficiency in industry is paid by "National Energy-Climate Plan 2030". 

  

Table 4: Policies and measures in industry

MeasuresDescriptionExpected savings, impact evaluationMore information available
Efficient use of energy resources, reduction of energy consumption and transfer to RES in manufacturing industryIn the period 2010-2015 the measures to increase EE in Industry was co-financed by the national green investment scheme (revenues from emissions trading under UFCCC Kyoto Protocol). Over the 2014-2020 planning period, the investments to improve EE in manufacturing industry are co-financed by Cohesion Fund within the National Operational Programme “Growth and Employment”. HighLink
Investments to Improve Energy Efficiency in Food Processing EnterprisesOver the 2014-2020 planning period, the investments to improve EE in food processing industry are co-financed by EAFRD within the National Rural Development ProgrammeMediumLink
ALTUM programmesThe State-owned Development Finance Institution “ALTUM” provides complementary programmes for energy efficiency, such as issue of green bonds (IND-LV3877), grants for energy audits (IND-LV3896).HighLink
Source: MURE